Home News Income taxes in Portugal to be reduced Income taxes in Portugal to be reduced To reflect the new reduction in income tax at the start of 2026, the government will need to update the withholding tax tables applied to employees and pensioners.
Income taxes in Portugal to be reduced
Sunday, 4 January 2026RSS
Context & Explainers
Withholding tax is the income tax deducted at source from salaries by employers, known in Portuguese as retenção na fonte. A recent change reduced these monthly deductions by roughly €12–€21 for many workers, so take-home pay will rise by about that amount depending on your bracket and family situation. For expats, this affects your net salary immediately but doesn’t change your annual tax liability — you may still need to reconcile taxes when filing your return.
